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Department of Employee Trust Funds
February 27, 2014

ETF Announces Annuity Adjustments

Core Annuity Adjustment 4.7%
Variable Annuity Adjustment 25.0%

The Department of Employee Trust Funds (ETF) announced Core and Variable annuity increases for retired members of the Wisconsin Retirement System (WRS) today. The 2013 Core annuity adjustment is 4.7% and the Variable annuity adjustment is 25.0%. The rates, recommended by the Department’s consulting actuary and approved by the ETF Board chair and ETF Secretary Robert Conlin, go into effect May 1.

The Core Fund increase is the first since the financial crisis of 2008 and follows five years of decreases. The annuity adjustments will affect more than 180,000 WRS retirees, about 90% of whom reside in Wisconsin.

The WRS does not provide annual cost-of-living adjustments (COLAs) to retirees. Under the WRS, pension adjustments are not automatic; they are based primarily on the investment performance of the pension funds. Annuity increases provided in previous years can be reduced or eliminated if the fund experiences poor investment performance.

Secretary Conlin acknowledged the work of the State of Wisconsin Investment Board (SWIB) for another strong investment year. SWIB, a separate state agency that manages the assets of the WRS trust funds, recently announced final calendar year 2013 returns of 13.6% for the Core Fund and 29.0% for the Variable Fund. The Core and Variable Trust Funds both performed ahead of their respective benchmarks for the one-, three-, five- and ten-year periods.

“SWIB’s strong investment performance not only allows the WRS to provide increases to retirees, it also helps maintain solid funding and hold down contribution rates for public employers and their employees,” said Conlin.

Additional ETF resources:

Interest Rates and Annuity Adjustments Video

ETF Press Release on Annuity Adjustments

Information for Retirees Regarding Annuity Adjustments

ETF Webinar: WRS Effective Rates and Annuity Adjustments

Core Fund and Variable Fund: Returns, Rates and Adjustments

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